Distribution is so yesterday
: Amazon is producing and airing a concert with Nora Jones, Bill Maher, and Bob Dylan for its 10th anniversary.
I’ll just bet this marks the start of Amazon 2.0: the content company.
Amazon was in the distribution business and it did a great job of finding new efficiencies and market shares and customer needs in it.
But distribution has been dethroned as a business. Owning the broadcast tower still makes you money — but as your audience departs for limitless new competition, it won’t grow. Owning a cable franchise is a great monopoly — but growth is there mostly because you can sell new services, broadband and VOIP, and before you know it, you’ll be nothing but the pipe: the next telco. Owning a monopoly newspaper used to be a great business — until more efficient marketplaces replaced yours and your presses and trucks and Teamsters suddenly looked not like a strength but like a cost. When I went to work for the Newhouses, I got excited at the prospect of working with Random House, which they then owned, but my boss wisely told me it wasn’t what a thought — “it’s just a distribution business,” he said.
Amazon was in the distribution business. But now it has relationships with millions of customers and a network of sales people — that is, its own customers writing reviews and creating valuable data about likes and dislikes. Now it has a brand that is trusted for content. Now it can enter the content business. Why not produce a show or a book directly for Amazon and sell it there? Why not turn Amazon into a powerhouse of advertising targeted to both content and consumer?
When that concert is performed, I’ll be watching the Amazon Channel.
: Ernie Miller says it’s not a channel. He’s right. In fact, I put this the wrong way: Amazon isn’t a content company, then, producing content itself. Amazon is not a network. But Amazon is a networking company, putting together buyers and sellers, readers and writers (and vice versa). So what I meant to say is that sometime soon, someone will chose to publish via Amazon directly to the public and skip the middleman formerly known as the publisher. That makes Amazon merely a conduit. One could say that it’s about distribution but in the case of digital content, the distribution is meaningless. It’s just a place that helps A find B. It’s a maven.
